Exhibit 10.16


 


AMENDED AND
RESTATED CO-EMPLOYER AGREEMENT


 


THIS AMENDED AND RESTATED CO-EMPLOYER AGREEMENT (the “Agreement”), dated
January 1, 2009, is made by and between RESACA EXPLOITATION, INC., a Texas
corporation (“Resaca,” formerly known as RESACA EXPLOITATION, LP, a Delaware
limited partnership); and TORCH ENERGY ADVISORS INCORPORATED, a Delaware
corporation (“Torch”). Resaca and Torch are referred to collectively in this
Agreement as the “Parties” and each is a “Party.”


 


RECITALS


 


WHEREAS, Resaca and Torch are parties to that certain Second Amended
and Restated Agreement for Administrative Services, dated of even date herewith,
(including any amendments or restatements thereto, the “Services Agreement”) in
which Resaca agrees to retain Torch as an independent contractor and agent to
perform certain administrative services on behalf of Resaca;


 


WHERAS, certain Torch employees provide administrative services to
Resaca in accordance with the terms of the Services Agreement;


 


WHEREAS, Resaca and Torch are parties to that certain Co-Employer
Agreement, dated July 11, 2008 (the “Original Agreement”), whereby the
Parties transitioned to a co-employer relationship and Resaca and Torch agreed
to assume certain federal, state statutory, common law, and regulatory employer
responsibilities and liabilities as co-employers of certain of the Parties’ Employees
(as defined below);


 


WHEREAS, the Parties desire to amend and restate the Original Agreement
to memorialize in writing their agreements with concerning their respective
rights and duties as co-employers of the Employees;


 


WHEREAS, the Parties intend this Agreement to be temporary in duration
and to only apply until such time as Resaca no longer needs Torch to provide
the co-employer services enumerated in this Agreement;


 


WHEREAS, Torch has agreed to provide certain payroll, operational, and
administrative services for the Employees as the agent of Resaca, to offer
certain employee benefits and insurance coverages to the Employees, and to
provide certain other duties of an employer to the Employees;


 


WHEREAS, Resaca has agreed to assume and provide other employer duties
on behalf of the Employees under this Agreement; and


 


WHEREAS, to reflect the agreement of the Parties concerning their
respective rights and duties as co-employers of the Employees, the Parties have
agreed to enter into this Agreement as follows:


 


I. COVERED
EMPLOYEES


 


Subject to the terms and conditions of this Agreement, Resaca and Torch
agree they will serve as co-employers with respect to the employees listed on Exhibit A to this
Agreement (collectively, the “Employees” and each an “Employee”), as such Exhibit A may be revised
by the Parties upon mutual agreement from time to time without the requirement
of a formal amendment to this Agreement.


 

















 


II. ADMINISTRATION


 


2.1           Employer Status. A number of
federal and state statutory, common law and regulatory provisions define the
employer-employee relationship. “Employer” status is based upon the functions
provided by the “employer” for which the employer-employee relationship is
being considered.


 


2.2           Agent Role of Torch. Torch shall be the
designated agent of Resaca regarding the Employees for compliance with rules and
regulations governing the reporting and payment of federal and state taxes on
payroll wages paid including, without limitation: (i) federal income tax
withholding provisions of the Internal Revenue Code; (ii) state and/or
local income tax withholding provisions, if applicable; (iii) Federal
Insurance Contributions Act (FICA); (iv) Federal Unemployment Tax Act (FUTA);
and (v) applicable state unemployment provisions.


 


2.3           Employer Role of Torch. Torch shall be
the employer of the Employees for the following purposes:


 


a.             providing
retirement benefits under a plan that is intended to qualify under Section 401(a) of
the Code;


 


b.             selection of
fringe benefits including, without limitation, holidays, vacation, sick leave, parental
leave, military leave, Family Medical Leave Act leave, Uniformed Services
Employment and Reemployment Right Act leave, and leave of absence;


 


c.             compliance with
the group health plan continuation requirements of the Consolidated Omnibus
Budget Reconciliation Act (COBRA);


 


d.             procuring major
medical, dental and such other group insurance policies as determined by the
Parties, in their discretion, from time to time, and making coverages under
these policies available to the Employees on such terms as agreed by the
Parties;


 


e.             employer
liability under workers’ compensation laws and providing workers’ compensation
insurance coverage; and


 


f.              providing
payroll services and compliance with rules and regulations governing the
reporting and payment of federal and state taxes on payroll wages paid.


 


In
addition, while Employees are engaged or working on Torch Matters (as defined
below) and for the time period such Employees are engaged or working on Torch
Matters, Torch shall be the employer of such Employees for the following
purposes:


 


a.             compliance with
Occupational Safety and Health Administration (OSHA) regulations;


 


b.             compliance with
Environmental Protection Agency (EPA) regulations and any state and/or local
equivalent;


 


c.             compliance with
the wage and hour provisions of the Fair Labor Standards Act (FLSA);


 


d.             day-to-day
supervision of the work of such Employees on the Torch Matters, the recruiting,
qualifying, training, disciplining, and discharging of the Employees, and the
direction of the means, manner, method, and details of the Employees’ work on
the Torch Matters on a day-to-day basis;


 


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e.             implementation
of policies and practices relating to the employer-employee relationship, such
as recruiting, interviewing, testing, selecting, training, evaluating, replacing,
supervision, disciplining and terminating Employees;


 


f.              compliance with
Title VII of the 1964 and 1991 Civil Rights Act, the Age Discrimination in
Employment Act, the Americans with Disabilities Act, and all other federal, state,
or municipal statutes, laws or regulations prohibiting employment discrimination,
harassment or retaliation in the workplace;


 


g.             compliance with
the federal Drug Free Workplace Act and any state or local equivalents; and


 


h.             assignment to, and
ownership of, all intellectual property rights including, without limitation, inventions,
whether patentable or not, and patents resulting therefrom, copyrights and
trade secrets and all confidentiality agreements regarding proprietary
information.


 


2.4           Employer Role of Resaca. While
Employees are engaged or working on Resaca Matters (as  defined below) and
for the time period such Employees are engaged or working on Resaca Matters, Resaca
shall be the employer of such Employees for the following purposes:


 


a.             compliance with
Occupational Safety and Health Administration (OSHA) regulations;


 


b.             compliance with
Environmental Protection Agency (EPA) regulations and any state and/or local
equivalent;


 


c.             compliance with
the wage and hour provisions of the Fair Labor Standards Act (FLSA);


 


d.             day-to-day
supervision of the work of such Employees on the Resaca Matters, the recruiting,
qualifying, training, disciplining, and discharging of the Employees, and the
direction of the means, manner, method, and details of the Employees’ work on
the Resaca Matters on a day-to-day basis;


 


e.             implementation
of policies and practices relating to the employer-employee relationship, such
as recruiting, interviewing, testing, selecting, training, evaluating, replacing,
supervision, disciplining and terminating Employees;


 


f.              compliance with
Title VII of the 1964 and 1991 Civil Rights Act, the Age Discrimination in
Employment Act, the Americans with Disabilities Act, and all other federal, state,
or municipal statutes, laws or regulations prohibiting employment
discrimination, harassment or retaliation in the workplace;


 


g.             compliance with
the federal Drug Free Workplace Act and any state or local equivalents; and


 


h.             assignment to, and
ownership of, all intellectual property rights including, without limitation, inventions,
whether patentable or not, and patents resulting therefrom, copyrights and
trade secrets and all confidentiality agreements regarding proprietary
information.


 


3

















 


In
addition, both Resaca and Torch shall be the employer of the Employees for
providing equity-based compensation under a long-term incentive plan.


 


2.5           Limitation on Employer
Duties. Nothing in this Article II shall be construed to require
either Party to provide any of the employer duties referred to herein except as
provided by applicable law which cannot be waived.


 


2.6           Other Employer Duties. For purposes
of this Agreement, the Parties shall, by mutual agreement, determine employer
status for events or situations not set forth and not contemplated in this
Agreement.


 


2.7           Notice. The Parties
agree to provide reasonable notice to each other of any Employee or employment—related
disputes, claims, charges, litigation or changes or material developments in
the scope of their respective duties as well as share all substantive
information regarding their respective duties. Each Party shall be entitled to
inspect all records regarding the other Party’s performance of its duties
hereunder.


 


2.8           Costs and Expenses. The Parties
agree that the costs and expenses associated with their respective employer
duties shall be paid in accordance with the terms of the Services Agreement.


 


2.9           Torch Matters and Resaca
Matters. As used herein, the term “Torch Matters” means any business activities
or work of Torch or its affiliates other than Resaca. As used herein, the term
“Resaca Matters” means any business activities or work of Resaca.


 


III.
ARBITRATION


 


3.1           Agreement to Arbitrate. Torch and
Resaca agree and stipulate that all claims, disputes and other matters in
question between Torch and Resaca arising out of or relating to this Agreement
or the breach thereof will be decided by binding arbitration before a single
arbitrator in accordance with the Federal Arbitration Act (9 U.S.C. § § 10 and
11) and the Commercial Arbitration Rules of the American Arbitration
Association, subject to the limitations of this Article III. This
agreement to so arbitrate, and any other agreement or consent to arbitrate
entered into in accordance with this Agreement, will be specifically
enforceable under the prevailing law of any court having jurisdiction.


 


3.2           Demand. Notice of the
demand for arbitration will be filed in writing with the other Party to the Agreement
and with the American Arbitration Association. The demand for arbitration shall
be made within a reasonable time after the claim, dispute or other matter in
question has arisen, and in no event shall any such demand be made after the
date when institution of legal or equitable proceedings based on such claim,
dispute or other matter in question would be barred by the applicable statute
of limitations.


 


3.3           Joinders. No
arbitration arising out of, or relating to, this Agreement shall include,
whether by consolidation, joinder or any other manner, any other person or
entity who is not a party to this Agreement unless:


 


a.             the inclusion
of such other person or entity is necessary if complete relief is to be
afforded among those who are already parties to the arbitration, and/or such
other person or entity is substantially involved in a question of law or fact,
which is common to those who are already parties to the arbitration, and which
will arise in such proceedings; and


 


b.             the written
consent of the other person or entity sought to be included and Torch and
Resaca has been obtained for such inclusion, which consent shall make specific
reference to this section; but no such consent shall constitute consent to
arbitration of any dispute


 


4

















 


not
specifically described in such consent or to arbitration with any party not
specifically identified in such consent.


 


3.4           Prevailing Party. The
prevailing party in any enforcement action arising in respect to this Agreement
shall be entitled to recover from the other party all costs of such enforcement
action including, without limitation, reasonable attorneys fees, costs and
related expenses as determined by the arbitrator in the award.


 


3.5           Awards. The award rendered
by  the
arbitrators will be final, judgment may be entered upon it in any court having
jurisdiction thereof, and will not be subject to modification or appeal except
to the extent permitted by the Federal Arbitration Act.


 


IV. MISCELLANEOUS


 


4.1           Amendment and Termination. This
Agreement may be amended at any time, and from time to time, as agreed by the
Parties in writing. Any such amendment must be executed by a duly authorized
officer of each Party and specifically refer to this Agreement. This Agreement
may be terminated by either Party by providing at least sixty (60) days’ prior
notice to the other Party unless the other Party agrees to a shorter notice
period. Notwithstanding the foregoing, this Agreement shall automatically
terminate on the third anniversary of the Effective Date or upon the
termination of the Services Agreement.


 


4.2           No Third Party Beneficiaries. This Agreement
is between the Parties and creates no individual rights of Employees or any
other persons. The Employees, and any other persons or entities, are not third
party beneficiaries of this Agreement.


 


4.3           Assignment. Neither Party
shall assign this Agreement or its rights and duties hereunder, or any interest
herein, without the prior written consent of the other Party; provided,
however, this Agreement may be transferred by operation of law to any successor
in interest to a Party.


 


4.4           Entire Agreement. This
Agreement contains the entire agreement of the Parties and supersedes all prior
and contemporaneous promises, agreements or understandings, whether written or
oral, regarding the subject matter of this Agreement.


 


4.5           Severability. If any
provision of this Agreement, or any amendment thereof, should become invalid
for any reason, the remaining provisions shall remain in effect and be so
construed as to effectuate the intent and purpose of this Agreement and any
amendments thereto.


 


4.6           Notices. All notices,
requests and communications provided hereunder shall be in writing and hand
delivered or mailed by United States registered, certified, or express mail,
return receipt requested, and addressed to the Party’s principal place of
business as set forth in this Agreement adjacent to the signature of each Party
(or to such other address provided in writing by such Party). All such notices
shall be effective upon receipt.


 


4.7           Waiver. The waiver by
either Party to this Agreement of a breach of any term or provision of in it
shall not operate or be construed as a waiver of a subsequent breach of the
same term or provision by any Party or of a breach of any other term or
provision of this Agreement.


 


4.8           Counterparts. This
Agreement may be executed in any number of counterparts, all of which together
shall constitute one Agreement binding on the Parties.


 


5

















 


4.9           Governing Law. EXCEPT FOR
ARTICLE III OF THIS AGREEMENT, WHICH SHALL BE GOVERNED BY THE FEDERAL ARBITRATION
ACT (9 U.S.C. §§ 10 AND 11), THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF
THE STATE OF TEXAS WITHOUT REGARD TO ITS CONFLICTS OF LAW PROVISIONS.


 


4.10         Amendment and Restatement of
Original Agreement. The Parties agree that the Original Agreement is
hereby amended and restated in its entirety and upon execution of this
Agreement, (i) the Original Agreement shall be of no further force and
effect, and (ii) all rights and obligations the Parties may have had under
the Original Agreement shall be superseded by this Agreement.


 


[Signature page follows.]


 


6

















 


IN WITNESS WHEREOF, this Agreement is hereby executed by a duly
authorized officer of each Party on January 1, 2009.


 


	
  Resaca Exploitation, Inc.

  	
   

  	
  Torch Energy Advisors Incorporated

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Mary Lou Fry

  	
   

  	
  By:

  	
  /s/
  Chris Work

  
	
   

  	
  Mary
  Lou Fry

  	
   

  	
   

  	
  Chris
  Work

  
	
   

  	
  Vice
  President, General Counsel and Secretary

  	
   

  	
   

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
  Address:

  	
  1331
  Lamar, Suite 1450

  	
   

  	
  Address:

  	
  1331
  Lamar, Suite 1450

  
	
   

  	
  Houston,
  Texas 77010

  	
   

  	
   

  	
  Houston,
  Texas 77010

  
	
  Tel.
  No.:

  	
  (713)
  650-1246

  	
   

  	
  Tel.
  No.:

  	
  (713)
  650-1246

  
	
  Fax
  No.:

  	
  (713)
  655-1866

  	
   

  	
  Fax
  No.:

  	
  (713)
  655-1866

  
							



 


Signature Page


 


Resaca/TEAI Co-Employer Agreement


 

















 


EXHIBIT A


 


Pursuant to Article I of the
Agreement, the Employees subject to this Agreement as of the execution date of
the Agreement, are as follows:


 




	
  Employee
  Last Name

  	
   

  	
  Employee First Name

  
	
   

  	
   

  	
   

  
	
  ANDIS

  	
   

  	
  KEVIN

  
	
  BARBER

  	
   

  	
  MARIA
  JUNG

  
	
  BRYAN

  	
   

  	
  J.P.

  
	
  CARMINE

  	
   

  	
  CINDY
  L

  
	
  CARTHRAE

  	
   

  	
  RALPH
  E

  
	
  COHEN

  	
   

  	
  ALICE
  C

  
	
  DAVIS

  	
   

  	
  LANA

  
	
  DEIBERT

  	
   

  	
  MARY
  FRANCES

  
	
  ESTRADA

  	
   

  	
  RAISA
  G

  
	
  FONTENOT

  	
   

  	
  BARBARA
  W

  
	
  FORD

  	
   

  	
  JEFFERY
  F

  
	
  FRY

  	
   

  	
  MARY
  LOU

  
	
  GUTHRIE

  	
   

  	
  TRACI
  J

  
	
  HERNANDEZ

  	
   

  	
  CONRADO
  A

  
	
  KELM

  	
   

  	
  PAMELA
  M

  
	
  LELEUX

  	
   

  	
  MARLA

  
	
  LENDRUM
  III

  	
   

  	
  JOHN
  J

  
	
  MADHAVAN

  	
   

  	
  DEEPA

  
	
  PADGETT

  	
   

  	
  PHYLLIS
  A

  
	
  PARSONS

  	
   

  	
  JAMI

  
	
  RADFORD

  	
   

  	
  LAKESHA
  D

  
	
  SERRETT

  	
   

  	
  DWIGHT
  D

  
	
  SMITH

  	
   

  	
  TAB
  R

  
	
  WORK

  	
   

  	
  CHRIS
  B

  
	
  YU

  	
   

  	
  MICHELLE
  H

  
	
  ZIEBARTH

  	
   

  	
  RANDY
  J

  






 


Exhibit A

Resaca/TEAI Co-Employer Agreement